Ismail Haniyeh, the deposed Hamas prime minister – in hiding from Israeli air strikes – sounded confident and dignified when he broadcast a message on new year's eve, quoting a Gaza Strip mayor on the Palestinians' stark choice between "slavery or death" as bombs and missiles rained down – and Hamas carried on firing into Israel.

It's worth recalling that the name Hamas is the Arabic acronym for the "Islamic Resistance Movement". In the circumstances, its rhetoric is as predictable as the most likely outcome of this latest bout of bloodletting. That will surely be another ceasefire with Israel, though the new one will involve more effective Arab and international monitoring than the one that was foolishly allowed to expire on 19 December. That's not going to be an earth-shattering achievement for the 420-plus dead counted by the seventh day of this war.

Still, Hamas officials sound defiant – goading Israel to invade and threatening new "martyrdom operations" after the "targeted assassination" of Nizar Rayyan, a senior figure admired for his military prowess and remembered for his involvement in the Hamas takeover of the Gaza Strip from Mahmoud Abbas's Fatah movement in June 2007.

If that was a nadir in recent Palestinian history, things got even worse this week. Internal divisions are now as bad as they were between the rival Husseini and Nashashibi camps during the 1936-1939 rebellion, with terrible consequences for the next and fateful round in 1948, when Israel's independence became the Palestinians' "Nakba" – catastrophe

Things got so bad that a Hamas spokesman publicly accused Abbas, the Palestinian president and Yasser Arafat's successor as PLO leader, of effectively collaborating with Israel by ordering Fatah members to gather intelligence on the whereabouts of Hamas leaders and pass it to Israel.

Abbas has chosen the path of negotiation and accommodation with Israel, concluding (as the PLO did officially as long ago as 1988) that armed resistance is futile. The problem is that Abbas has so little to show for it: the 15 years since the Oslo agreement have seen Israeli settlements double and the West Bank carved up into disconnected enclaves controlled by Israel. The Hamas challenge to the effectiveness and legitimacy of the Palestinian Authority is not a hollow one.

Israeli actions have widened the gap between the West Bank and Gaza, and created the conditions that led to the 2007 Hamas takeover. Israel's narrative, backed by the US, is of unprovoked attacks despite its unilateral withdrawal of troops and settlers from the strip in 2005. The truth is that Israel has been waging war against Gaza through economic blockades, assassinations and other means, with results that have been painstakingly documented in dozens of reports by the UN and others. Ordinary Palestinians have suffered most, just as ordinary Iraqis suffered far more than Saddam Hussein under UN sanctions. But Gazans are not going to rebel against Hamas because their children are hungry or the streets are full of untreated sewage.

As the veteran Palestinian commentator Rami Khouri puts it: "Active, bilateral Palestinian-Israeli warfare – not unilateral Hamas rocketry – is the correct context in which to understand and analyse the current situation." And so, it should be added, is Hamas's fundamental ideological rejection of Israel – an integral part of its Islamist outlook.

Hamas and Fatah need to get back together. Egypt tried and failed to broker an agreement covering power-sharing, a joint political programme and new elections. As the Carnegie Foundation's Nathan Brown, one of the most perceptive foreign analysts of Palestinian affairs, argued in November (pdf), there needs to be "a very significant international effort to push for Palestinian unity."

Peering through the smoke, there are signs that internal pressure may now mount for such a reconciliation as demonstrators in Ramallah and elsewhere in the West Bank express solidarity with their kinfolk in Gaza. After all, the Hamas police recruits killed en masse in Israel's "shock and awe" first strike on 27 December joined up because many had worked for Fatah but were no longer being paid because of the rupture with the West Bank. Khalil Shikaki, doyen of Palestinian pollsters, predicts that anger and frustration will be turned against Abbas and the Palestinian Authority.

The urgent case for an independent, viable, united Palestinian state alongside Israel has been rewritten in blood again this week. It is hard to say if that will ever be achieved. But if Palestinians do not reunite, it is surely certain that it never will be.